Artificial intelligence is transforming corporate procurement operations across Britain and globally, with companies reporting returns on investment exceeding 50 per cent and multi-million-pound savings, according to the latest industry research and real-world implementations in 2025.
Major firms including Pentair, Kärcher, and Fortune 500 energy companies are achieving dramatic improvements in efficiency, with some reducing procurement processing times by up to 90 per cent whilst uncovering millions in cost savings opportunities.
The rapid adoption reflects a fundamental shift in how businesses manage their supplier relationships and spending, with 92 per cent of chief procurement officers planning to invest in AI capabilities this year, according to a Deloitte survey of over 100 CPOs across Europe, North America, and Asia-Pacific.
“Never before has procurement been core to so many executive-committee-level priorities,” a manufacturing company CPO told researchers. “We now have a real seat at the top table. And this is not a temporary situation, this is how we will operate going forward.”
The momentum is accelerating dramatically. Weekly use of generative AI within procurement functions increased 44 percentage points from 2023 to 2024, with 94 per cent of procurement executives now using the technology at least once a week, according to research by AI at Wharton.
Multi-Million Pound Savings Emerge
Global companies are reporting substantial financial benefits from AI procurement implementations. A pharmaceutical company using AI to verify supplier invoices identified more than £8 million ($10 million) in value leakage within just four weeks, representing an average of 4 per cent of the analysed spend.
Pentair achieved a £12 million ($15 million) working capital improvement after implementing an AI procurement solution that provided over 90 per cent accuracy in spend classification. The system, deployed globally in just two months, enabled category managers to identify savings opportunities and drive strategic sourcing across the organisation.
This level of adoption, along with promising use cases, such as contract management, means GenAI will rapidly move through the Hype Cycle and reach the Plateau of Productivity at a faster rate than is typical for most emerging technologies in procurement,” said Kaitlynn Sommers, Senior Director Analyst with Gartner’s Supply Chain Practice.
A Fortune 500 oil and gas company consolidated 15 legacy procurement systems into two AI-powered platforms, achieving a 20 per cent increase in eSourcing adoption and a 15 per cent enhancement in procurement ROI. The streamlined system facilitated faster responses to market changes and improved contract management across global operations.
Productivity Gains Transform Operations
The productivity improvements reported by early adopters are equally impressive. Companies implementing generative AI in procurement report improvements reaching up to 25 per cent across productivity, effectiveness, and user experience, according to The Hackett Group’s 2025 Procurement Agenda study.
Kärcher’s implementation of an autonomous operations solution brought significant efficiency enhancements to non-production-related procurement. The AI-powered platform automated execution, negotiation, and award of tactical procurement processes, achieving substantial discounts and time savings whilst allowing staff to focus on value-added tasks.
“GenAI can already enhance many different workflows in procurement,” Sommers noted, highlighting that 73 per cent of procurement leaders expected to adopt the technology by the end of 2024.
Microsoft reported that Lumen reduced sales interaction preparation time from four hours to just 15 minutes using AI tools, projecting annual time savings worth £40 million ($50 million). Similarly, legal firm DLA Piper saved up to 36 hours weekly on content generation and data analysis after deploying AI solutions.
Investment Surge Despite Challenges
The financial commitment to AI in procurement is substantial and growing. Currently, 11 per cent of organisations spend more than £800,000 ($1 million) annually on generative AI capabilities for sourcing and procurement. By 2025, this figure is expected to more than double, with 22 per cent of CPOs planning to invest £800,000 or more in AI capabilities.
“Organizations believe GenAI will unlock value through enhanced insights and decision-making, productivity gains and cost optimisation,” the Deloitte survey found. “Most have seen promising early returns on GenAI investments despite implementation challenges.”
However, significant obstacles remain. Data quality emerged as the second major internal barrier to AI adoption, with 63 per cent of organisations either lacking or uncertain about having the right data management practices for AI, according to Gartner research.
“Organizations that fail to realize the vast differences between AI-ready data requirements and traditional data management will endanger the success of their AI efforts,” warned Roxane Edjlali, Senior Director Analyst at Gartner.
Technology Giants Lead Innovation
Major technology providers including SAP, Oracle, and IBM are racing to embed AI capabilities into their procurement platforms. SAP announced plans to deliver 400 embedded AI use cases across its cloud portfolio by the end of 2025, with its AI assistant Joule enabling task completion up to 90 per cent faster.
“The fact that supply chain shortages are now much less widespread, and demand is decreasing means there is more competition among suppliers,” said Sushank Agarwal, Managing Director at consultancy INVERTO. That has created a far better environment for procurement teams to deliver value next year.
Oracle reported its cloud revenue growing at 20 per cent annually, driven partly by AI implementations in procurement and supply chain management. The company signed its largest sales contracts in history during 2024, fuelled by demand for AI infrastructure.
Retail and Manufacturing Lead Adoption
In the retail sector, companies are achieving significant operational improvements. A national retail chain using AI logistics cut delivery times by 18 per cent whilst saving over £160,000 ($200,000) annually in fuel and labour costs.
Zara uses AI to monitor fashion trends and social media to inform design and production decisions, allowing rapid restocking of bestsellers whilst avoiding overproduction. Unilever integrated AI across 20 supply chain control towers worldwide, improving responsiveness to demand changes and reducing stockouts.
“AI enhances supply chain with smarter forecasting and automation,” noted industry analysts, with manufacturing companies reporting up to 64 per cent cost reduction through AI implementations.
Future Outlook Remains Positive
Despite challenges, the trajectory for AI in procurement appears overwhelmingly positive. McKinsey estimates that over the long term, generative AI could yield £3.5 trillion ($4.4 trillion) in productivity growth potential globally.
By 2027, Gartner predicts that 50 per cent of organisations will support supplier contract negotiations through AI-enabled contract risk analysis and editing tools. The research firm also expects at least 15 per cent of day-to-day work decisions to be made autonomously through AI by 2028.
“If the business outcomes meet or exceed expectations, it presents an opportunity to expand investments by scaling GenAI innovation and usage across a broader user base,” said Rita Sallam from Gartner.
However, experts caution that success requires careful implementation. Gartner predicts that 30 per cent of generative AI projects will be abandoned after proof of concept by the end of 2025 due to poor data quality, inadequate risk controls, escalating costs, or unclear business value.
The message for procurement leaders is clear: those who successfully implement AI stand to gain significant competitive advantages through cost savings, efficiency improvements, and enhanced decision-making capabilities. But success requires substantial investment in data quality, change management, and strategic planning to realise the technology’s full potential.
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